Bulgaria, which was invited to join NATO last November, launched in 1999 an effort to streamline its army and bring it up to NATO standards by 2004.

The cash handout is worth 300,000 euros (350,000 dollars), the sources said.

Nearly 7,000 servicemen and women will be laid off this year, following 7,000 in 2002.

A German company is to open 10 information and counselling centres from Monday in Bulgaria's seven biggest cities, where the largest contingents are stationed.

The restructuring plans include financial incentives for employers who offer long-term jobs to former troops, as well as subsidies for those who want to start small businesses.

The Bulgarian armed forces, 93,000-strong in 1999, are scheduled to be trimmed to 45,000 by next year.

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